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Próspera ZEDE, a special economic zone in Honduras, has taken a significant step by officially recognizing Bitcoin (BTC) as a unit of account. This development allows for the use of the digital currency in a variety of commercial, fiscal, and financial activities within the zone.

Jorge Colindres, the current manager and Tax Commissioner of Próspera ZEDE, announced the new policy on January 5. He explained the framework under which legal entities in the zone can use Bitcoin as their standard for financial accounting.

“Próspera ZEDE recognizes the right of (e)Resident legal entities organized or registered under the authority of the Prospero Entity Registry Statute to use Bitcoin (“BTC”) as their respective unit of account, in the sense of the monetary unit or measure of value in terms of which their accounts are kept and values stated,” Colindres stated in the announcement.

Entities choosing to use Bitcoin as their accounting unit must notify the Tax Commissioner within thirty days of the applicable tax period, citing a reference from a major cryptocurrency exchange like Kraken or Coinbase.

Until the Final BTC Tax Payment Procedure is in place, these entities will calculate their tax liabilities in Bitcoin for internal purposes but report and pay them to Próspera ZEDE in U.S. dollars or the local Lempira currency. However, once the Final BTC Tax Payment Procedure is implemented, tax liabilities will be both reported and paid in Bitcoin.

The announcement also provided a sanctioned form for entities to declare their choice to use Bitcoin. Próspera ZEDE’s General Service Provider will make available BTC Election Notice form templates and incorporate the necessary functionalities into the eProspera eGovernance platform for data submission and filing processes.

This move by Próspera ZEDE follows previous speculation that Honduras might legalize Bitcoin as a national currency, similar to El Salvador. However, in 2022, the Central Bank of Honduras issued a statement debunking such rumors and advising against using cryptocurrencies like Bitcoin in financial transactions due to their lack of legal recognition.